Listings are marketing documents, not diligence packages. Use the disclosed facts to identify contradictions, missing evidence and the economics that must be true-not to convince yourself that the deal works.
The ten-minute sequence
The calculation below uses an illustrative GTA listing.
- Minutes 0-2: fit. Confirm geography, industry, price, revenue range and whether the likely owner role fits your buy box.
- Minutes 2-4: arithmetic. Calculate asking price divided by stated cash flow and stated cash flow divided by revenue.
- Minutes 4-6: owner role. Identify “owner-operated,” hours worked, selling duties, technical licences and relationships that may leave with the seller.
- Minutes 6-8: fragility. Look for concentration, lease expiry, seasonality, capital equipment, working-capital intensity and dependence on one channel.
- Minutes 8-10: evidence request. Write the five documents or answers that would most quickly confirm or reject the thesis.
| Asking price | $900,000 |
| Stated cash flow | $300,000 |
| Headline multiple | 3.0x |
| Less replacement operator | $110,000 |
| Adjusted cash flow before debt | $190,000 |
| Price / adjusted cash flow | 4.74x |
The replacement-role calculation changes the question from “Is 3.0x cheap?” to “What job am I buying, and what return remains if I do not perform it?”
Words that require evidence
- “Recurring revenue”: request cohort retention, cancellations and contract terms.
- “Absentee owner”: request the owner's calendar, approvals and customer responsibilities.
- “Huge growth opportunity”: ask why the current owner did not pursue it and what investment is required.
- “Little competition”: define the market and alternatives customers actually consider.
- “Seller financing available”: ask about amount, term, security, subordination and conditions.
End with one of three decisions
Pass when the deal violates the buy box or only works by ignoring the owner role. Request information when basic economics are plausible and a small set of evidence can resolve the main uncertainty. Monitor when the fit is interesting but price, timing or geography is wrong.
Run the headline math
Put the listing numbers into the AndChill calculator before requesting a call.
A ten-minute screen should end with a decision
Use three minutes for arithmetic, three for the owner's job, two for revenue quality and two for evidence gaps. The output is not “good business” or “bad business.” It is one of three actions: pass, request information or schedule a call.
| Asking price | $1,350,000 |
| Claimed SDE | $450,000 |
| Headline multiple | 3.0x |
| Replacement manager and sales support | − $165,000 |
| Buyer-adjusted earnings | $285,000 |
| Adjusted multiple | 4.74x |
The listing did not become worse. The buyer clarified that it contains a job worth $165,000. That is exactly what a fast screen is supposed to uncover.
Grade the evidence, not the adjectives
Give each major claim an evidence grade: A for filed returns, signed contracts or system exports; B for internally generated reports that reconcile; C for seller explanation without support; and D for “potential.” Revenue described as recurring earns no credit until you know the cancellation terms, retention history and customer concentration. “Semi-absentee” means nothing until the weekly duties and emergency coverage are listed.
Write the reason for your result
Record one sentence: “Pass because customer concentration exceeds the buy box,” or “Advance if tax returns support SDE and the manager is staying.” This prevents the same attractive listing from consuming attention three times. It also turns a year of searching into data about what the buyer repeatedly rejects.
Sources and methodology
Send us the listing you are screening.
We will separate disclosed facts, assumptions and the questions that determine whether it deserves another hour.
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